Correlation Between PTL and SAG Holdings
Can any of the company-specific risk be diversified away by investing in both PTL and SAG Holdings at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining PTL and SAG Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PTL LTD Ordinary and SAG Holdings Limited, you can compare the effects of market volatilities on PTL and SAG Holdings and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in PTL with a short position of SAG Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of PTL and SAG Holdings.
Diversification Opportunities for PTL and SAG Holdings
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between PTL and SAG is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding PTL LTD Ordinary and SAG Holdings Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SAG Holdings Limited and PTL is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on PTL LTD Ordinary are associated (or correlated) with SAG Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SAG Holdings Limited has no effect on the direction of PTL i.e., PTL and SAG Holdings go up and down completely randomly.
Pair Corralation between PTL and SAG Holdings
Given the investment horizon of 90 days PTL LTD Ordinary is expected to generate 1.97 times more return on investment than SAG Holdings. However, PTL is 1.97 times more volatile than SAG Holdings Limited. It trades about 0.24 of its potential returns per unit of risk. SAG Holdings Limited is currently generating about -0.21 per unit of risk. If you would invest 417.00 in PTL LTD Ordinary on August 31, 2024 and sell it today you would earn a total of 271.00 from holding PTL LTD Ordinary or generate 64.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PTL LTD Ordinary vs. SAG Holdings Limited
Performance |
| Timeline |
| PTL LTD Ordinary |
| SAG Holdings Limited |
PTL and SAG Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PTL and SAG Holdings
The main advantage of trading using opposite PTL and SAG Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PTL position performs unexpectedly, SAG Holdings can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in SAG Holdings will offset losses from the drop in SAG Holdings' long position.| PTL vs. Summit Environmental | PTL vs. Algoma Steel Group | PTL vs. Hf Foods Group | PTL vs. Sanyo Special Steel |
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Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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